Adenosine

Exploration and evaluation of strategic alternatives continueWESTPORT, Conn., Aug. 27, 2024 (GLOBE NEWSWIRE) -- Portage Biotech Inc. (“Portage” or the “Company”) (NASDAQ: PRTG), a clinical-stage immuno-oncology company with a portfolio of novel multi-targeted therapies for use as monotherapy and in combination, today reported its financial results for the fiscal quarter ended June 30, 2024. “We continue to explore strategic alternatives. These may include finding a partner for one or more of our assets, a sale of our company, a merger, restructurings (both in and out of court), a company wind down, further financing efforts, or other strategic actions,” said Dr. Ian Walters, Chief Executive Officer and Chairman of Portage. “We are encouraged by the two advanced patients that continue on PORT-6 beyond 6 months who we continue to follow, and we plan to replace one patient in the ADPORT-601 trial who withdrew prior to dose limiting toxicity assessment for an unrelated adverse event. We also continue our collaborations with numerous experts to further understand the biology and utility of our product candidates,” continued Dr. Walters. Financial Results for the Quarter Ended June 30, 2024 The Company incurred a net loss of approximately $1.7 million during the three months ended June 30, 2024 (the “Fiscal 2025 Quarter”), compared to a net loss of approximately $4.2 million during the three months ended June 30, 2023 (the “Fiscal 2024 Quarter”), representing a $2.5 million decrease in net loss. Operating expenses, including research and development (“R&D”) costs and general and administrative (“G&A”) expenses, were $2.8 million in the Fiscal 2025 Quarter, down from $5.0 million in the Fiscal 2024 Quarter, a decrease of $2.2 million, as detailed below. R&D costs decreased by approximately $2.3 million, or 64%, from $3.6 million in the Fiscal 2024 Quarter, to $1.3 million in the Fiscal 2025 Quarter. This reduction was primarily due to the winding down of clinical trial costs (principally CRO-related), which decreased by $0.3 million, from $1.0 million in the Fiscal 2024 Quarter to $0.7 million in the Fiscal 2025 Quarter, as the Company paused enrollment in its sponsored clinical trials in the third and fourth quarters of the fiscal year ended March 31, 2024. Manufacturing-related costs decreased by $0.7 million, from $0.8 million in the Fiscal 2024 Quarter to $0.1 million in the Fiscal 2025 Quarter. These decreases reflect reduced clinical activity and manufacturing costs following the Company’s decision to discontinue the iNKT program and pause further patient accrual in the adenosine program. Additionally, R&D non-cash share-based compensation expense decreased from $0.4 million in the Fiscal 2024 Quarter to nil in the Fiscal 2025 Quarter. Payroll-related expenses also decreased by $0.2 million, from $0.5 million in the Fiscal 2024 Quarter to $0.3 million in the Fiscal 2025 Quarter, due to the resignation of two employees in January 2024. Further, in the Fiscal 2024 Quarter, the Company incurred a $0.5 million milestone payment for dosing its first adenosine patients. Consulting fees decreased by $0.1 million, from $0.2 million in the Fiscal 2024 Quarter to $0.1 million in the Fiscal 2025 Quarter, reflecting the decline in consulting-related activity. Lastly, there was a $0.1 million decrease in fees paid related to the transition of the iNKT study before its discontinuation. G&A expenses increased by $0.1 million, or 7%, from $1.4 million in the Fiscal 2024 Quarter to $1.5 million in the Fiscal 2025 Quarter. Professional fees increased by $0.1 million, from $0.5 million in the Fiscal 2024 Quarter to $0.6 million in the Fiscal 2025 Quarter, primarily due to legal fees associated with regulatory filings, corporate matters, and related audit fees. Payroll-related expenses increased by $0.4 million from $0.2 million in the Fiscal 2024 Quarter to $0.6 million in the Fiscal 2025 Quarter due to the amounts associated with retention agreements executed with an employee and a consultant. Additionally, G&A non-cash share-based compensation expense decreased by $0.2 million due to the continued vesting of stock options with higher fair values, partially offset by recording all Fiscal 2025 Quarter share-based compensation expense as G&A expenses as the result of the discontinuation of the iNKT study and the pause of further patient accrual in the adenosine program. Directors’ fees also decreased by $0.1 million in the Fiscal 2025 Quarter, as all directors, except for two who resigned in April 2024, waived their fees. The primary reasons for the quarter-over-quarter differences in the Company’s pre-tax items of income and expense were the $1.1 million non-cash gain from the change in the fair value of certain warrants accounted for as liabilities, issued in connection with an equity offering in October 2023, in the Fiscal 2025 Quarter, and the non-cash loss from the increase in the fair value of the deferred purchase price payable to the former Tarus shareholders and the deferred obligation for the iOx milestone, totaling $1.1 million, in the Fiscal 2024 Quarter. As of June 30, 2024, the Company had cash and cash equivalents of approximately $3.3 million and total current liabilities of approximately $3.0 million. About Portage Biotech Inc. Portage is a clinical-stage immuno-oncology company with a portfolio of multi-targeted therapies to extend survival and significantly improve the lives of patients with cancer. The Company has made the decision to discontinue its sponsored trial for its the invariant natural killer T-cell (iNKT) program and pause further patient accrual to its sponsored adenosine trial program (ADPORT-601 trial) for its potentially best-in-class adenosine antagonists PORT-6 (adenosine 2A inhibitor) and PORT-7 (adenosine 2B inhibitor). The Company is exploring strategic alternatives, which may include finding a partner for one or more of its assets, a sale of the company, a merger, restructurings, both in and out of court, a company wind down, further financing efforts or other strategic actions. For more information, please visit www.portagebiotech.com, follow us on Twitter at @PortageBiotech or find us on LinkedIn at Portage Biotech Inc. Forward-Looking Statements All statements in this news release, other than statements of historical facts, including without limitation, statements regarding about the Company’s information that are forward-looking in nature and, business strategy, plans and objectives of management for future operations and those statements preceded by, followed by or that otherwise include the words "believe," "expects," "anticipates," "intends," "estimates," “will,” “may,” “plan,” “potential,” “continue,” or similar expressions or variations on such expressions are forward-looking statements. For example, statements regarding the Company's plans to continue exploring strategic alternatives, which may include finding a partner for one or more of its assets, a sale of the company, a merger, restructurings (both in and out of court), a company wind down, further financing efforts, or other strategic actions, the Company’s expectation to replace one patient in the ADPORT-601 trial, and the Company’s plans to continue its collaborations with numerous experts to further understand the biology and utility of its product candidates are forward-looking statements. As a result, forward-looking statements are subject to certain risks and uncertainties, including, but are not limited to: the Company's plans and ability to develop and commercialize product candidates and the timing of these development programs; the Company's clinical development of its product candidates, including the results of current and future clinical trials; the benefits and risks of the Company's product candidates as compared to others; the Company's maintenance and establishment of intellectual property rights in its product candidates; the Company's ability to obtain financing in the future to cover its operational costs and progress its plans for clinical development, its estimates regarding its capital requirements, and its ability to continue as a going concern; the Company’s estimates of future revenues and profitability; the Company's estimates of the size of the potential markets for its product candidates; its selection and licensing of product candidates; and other factors set forth in “Item 3 - Key Information-Risk Factors” in the Company’s Annual Report on Form 20-F for the year ended March 31, 2024. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, undue reliance should not be placed on them as actual results may differ materially from these forward-looking statements. The forward-looking statements contained in this news release are made as of the date hereof, and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, except as required by law. FOR MORE INFORMATION, PLEASE CONTACT:Investor Relations:ir@portagebiotech.com Media Relations:media@portagebiotech.com ---tables to follow--- PORTAGE BIOTECH INC.Condensed Consolidated Interim Statements of Operations and Other Comprehensive Income (Loss)(U.S. Dollars in thousands, except per share amounts)(Unaudited) Three Months Ended June 30, 2024 2023 Expenses Research and development $1,305 $3,627 General and administrative expenses 1,534 1,370 Loss from operations (2,839) (4,997)Change in fair value of warrant liability 1,142 – Change in fair value of deferred purchase price payable - Tarus and deferred obligation - iOx milestone – (1,111)Share of loss in associate accounted for using equity method – (50)Foreign exchange transaction (loss) gain (2) 18 Depreciation expense (8) (11)Interest income, net 45 80 Loss before provision for income taxes (1,662) (6,071)Income tax (expense) benefit (2) 145 Net loss (1,664) (5,926)Other comprehensive income (loss) Net unrealized gain on investments – 1,769 Total comprehensive loss for period $(1,664) $(4,157) Net loss attributable to: Owners of the Company $(1,656) $(5,919)Non-controlling interest (8) (7)Net loss $(1,664) $(5,926) Comprehensive loss attributable to: Owners of the Company $(1,656) $(4,150)Non-controlling interest (8) (7)Total comprehensive loss for period $(1,664) $(4,157) Loss per share Basic and diluted $(1.58) $(6.69) Weighted average shares outstanding Basic and diluted 1,049 885 PORTAGE BIOTECH INC.Condensed Consolidated Interim Statements of Financial Position(U.S. Dollars in thousands)(Unaudited) June 30,2024 March 31,2024 (Audited) Assets Current assets Cash and cash equivalents $3,334 $5,028 Prepaid expenses and other receivables 1,862 2,667 Total current assets 5,196 7,695 Non-current assets Right to use asset 27 35 Other assets, including equipment, net 14 49 Total non-current assets 41 84 Total assets $5,237 $7,779 Liabilities and Equity Current liabilities Accounts payable and accrued liabilities $2,965 $2,836 Lease liability - current, including interest 37 40 Other current liabilities 3 3 Total current liabilities 3,005 2,879 Non-current liabilities Lease liability - non-current – 7 Warrant liability 422 1,564 Total non-current liabilities 422 1,571 Total liabilities 3,427 4,450 Shareholders’ Equity Capital stock 219,500 219,499 Stock option reserve 23,985 23,841 Accumulated deficit (240,974) (239,318)Total equity attributable to owners of the Company 2,511 4,022 Non-controlling interest (701) (693)Total equity 1,810 3,329 Total liabilities and equity $5,237 $7,779 Commitments and Contingent Liabilities

Vanilla, the most widely used flavoring compound in confectionaries and cosmetics, gets its sweet flavor and aroma from the chemical compound -- 'vanillin'. However, the large-scale production of natural vanillin is impeded by the lack of microbial processes and enzymes which can commercially generate vanillin. Now, researchers have genetically engineered a novel enzyme which can convert ferulic acid from plant waste into vanillin in a one-step sustainable process. Vanilla extract is one of the most widely used flavoring compounds in food products and cosmetics. The pleasant and sweet smell of this classic flavor is imparted by the chemical compound 'vanillin' found in the seed pods of vanilla plants belonging to the orchid family. In plants, vanillin is synthesized by the conversion of ferulic acid by the enzyme -- VpVAN. However, laboratory biosynthesis of vanillin from plant-derived VpVAN yields only very small quantities of vanillin, and is, therefore, commercially impractical. Further, although chemically derived vanilla essences are available cheaply, they do not match the flavor of natural vanilla extract, and the demand for the latter continues to remain high. Additionally, climatic restrictions for the cultivation of vanilla plants, and the relatively small yield obtained per plant, have led to a dwindling supply and a surge in the price of natural vanilla extract. Addressing these challenges, Professor Toshiki Furuya from the Department of Applied Biological Science, Faculty of Science and Technology, Tokyo University of Science, and his graduate students Shizuka Fujimaki and Satsuki Sakamoto, successfully developed an enzyme that generates vanillin from plant-derived ferulic acid. "Ferulic acid, the raw material, is a compound that can be obtained in abundance from agricultural waste such as rice bran and wheat bran. Vanillin is generated simply by mixing ferulic acid with the developed enzyme at room temperature. So, the established technology can provide a simple and environmentally friendly method for producing flavor compounds," explains Prof. Furuya. Their study was published on May 10, 2024 in Applied and Environmental Microbiology. The researchers used genetic engineering approaches to modify the molecular structure of an enzyme -- 'Ado.' Ado is originally an oxidase enzyme that adds an oxygen atom to the substrate -- isoeugenol. In its native state, it does not have the ability to convert ferulic acid into vanillin. Using structural modeling analysis, the researchers were able to predict amino acid changes in Ado which would enable its interaction with ferulic acid. On these lines, they conducted a series of experiments by replacing phenylalanine and valine amino acid residues at specific positions in the structure of Ado, with various other amino acids. They went on to examine the ferulic acid conversion ability of the various engineered mutant proteins. Following several trials and errors, they found that a mutant protein in which only three specific phenylalanine and valine residues were replaced with tyrosine and arginine, stably reacted with ferulic acid and exhibited high conversion activity. Notably, the engineered enzyme did not require any cofactors for conversion, unlike other oxidases, and produced vanillin on a gram scale per liter of reaction solution, with a higher catalytic efficiency and affinity than that of the wild-type enzyme. The reaction only required mixing of the enzyme, ferulic acid, and air (molecular oxygen), at room temperature, making it a simple, sustainable, and economically scalable process. Furthermore, the molecularly evolved enzyme also exhibited conversion activity towards p-coumaric acid and sinapic acid, which are compounds obtained from the degradation of lignin -- a common agricultural waste product. So far, no microbial or plant-derived enzymes have exhibited the ability to convert ferulic acid to vanillin at an industrial scale. Therefore, the enzyme developed in the current study shows considerable potential for enabling the commercial and economically viable production of natural vanillin. Explaining the long-term implications of their research, Prof. Furuya states, "Harnessing the potential of microorganisms and enzymes to derive valuable compounds under mild conditions from renewable plant-based resources, offers a sustainable approach to minimizing environmental footprint. Presently, in collaboration with a company, our research endeavors focus on achieving the real-world implementation of vanillin production through the utilization of the newly developed enzyme."